KARRATHA and Moranbah are two small mining towns, but the Western Australian hub will be anything but small when it's transformed into a city of 50,000 people.

While Moranbah and the Isaac region are bracing for a huge influx of fly-in, fly-out workers, the Western Australian government plans to replace most of its FIFO workers with permanent north-west residents.

It has plans to build 1000 new homes a year in Karratha as part of an ambitious multi-billion dollar vision, which is set to increase the town's population from 18,000 to 50,000.

Just last week the WA government announced the preferred developer for the $1.5 billion Karratha City Project.

As part of the plans, a 150-room hotel with 10,000sqm of commercial space, hospitality and entertainment venues will be built in the heart of Karratha as well as up to 50 serviced worker apartments.

More than 1500 homes linking Karratha to the coast will be built and coastal residential land is scheduled for release in 2014.

WA Regional Development Minister Brendon Grylls said the project would help drive down rents in Karratha, where modest homes fetched more than $2000 a week.

WA Premier Colin Barnett said while the number of FIFO workers would continue to rise in the short term, most would eventually be replaced by permanent northwest residents.

"Fly-in, fly-out has been a feature of the mining industry since the 1980s," he said.

"(But) there are social consequences, especially when you have families separated."

Meanwhile, thousands of additional non-resident workers are expected to flood Moranbah and the Isaac region for Boom Mark II.

While estimates vary on the projections of non-resident workers for the region, it's anticipated they could very well outnumber the population of permanent residents, currently about 22,689, by mid 2012.

Isaac Mayor Cedric Marshall said his council was struggling to keep up with the growth and called upon the State Government to look at significantly investing in the region, just like the WA government had done in Karratha.

"We are nowhere near as remote but if the State Government would invest (significantly in our region) that would help.

"There is that feeling here that they're happy to take the money (mining royalties) but don't want to give it back."

When asked about why the State Government wasn't planning to develop Moranbah on the same scale as Karratha, Local Government Minister Paul Lucas said WA was playing catch-up trying to create regional communities Queensland had always invested in.

He also said strictly literal interpretations of FIFO would mean miners who chose to live in Mackay and on the coast would not be able to work at the mines.